Tuesday, August 3, 2010

Crude Oil Bulls Take Clear Advantage, Higher Prices Likely

Crude oil was higher overnight as it extends the rally off July's low. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term.

If September extends the aforementioned rally, the reaction high crossing at 84.50 is the next upside target. Closes below the 20 day moving average crossing at 77.71 would confirm that a short term top has been posted.

First resistance is the overnight high crossing at 82.10
Second resistance is the reaction high crossing at 84.50

Crude oil pivot point for Tuesday morning is 80.65

First support is the 10 day moving average crossing at 78.87
Second support is the 20 day moving average crossing at 77.71

Natural gas was higher due to short covering overnight as it consolidates some of Monday's decline. Stochastics and the RSI are overbought and are turning neutral to bearish signaling that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 4.577 would confirm that a short term top has been posted. If September extends the aforementioned rally, June's high crossing at 5.282 is the next upside target.

First resistance is Monday's high crossing at 5.007
Second resistance is June's high crossing at 5.282

Natural gas pivot point for Tuesday morning is 4.796

First support is the 10 day moving average crossing at 4.683
Second support is the 20 day moving average crossing at 4.577